Weekly News (November 2, 2022)

Mortgage Interest Rates Review 

(Fairway Asset Corp. 11/2/2022)

 Federal Fund Rate: 3.00 -3.25%        Prime Rate: 6.00-6.25% 

Casio places are submerged due to the climate change : 침수되는 카지노  휴양도시

(Korea Times  10/28/2022)

• According to AP, the sea level indicator, which has been installed in Atlantic City, NJ in 1910, shows 1.5 feet sea level increase for last 100 years. This is double the average sea level increase worldwide.
• Coastal area such as Atlantic City have to decide that the town should force to move out of the area within a few years. Woodbridge 160Km far from the Atlantic City had to buy 150 houses and demolish them in the past.
• Robert Cap, a researcher at Rutgers Univ. said NJ will experience significant sea level increase from now and 2070. If sea level increases 3 – 5 feet, the current redevelopment plans might be reviewed.

Construction Starts for Miami’s First Supertall Skyscraper: 마이애미에 처음으로 초고층 빌딩 착공 

(WSJ  11/2/2022)

• Miami’s Waldorf Astoria residential tower, poised to be South Florida’s tallest skyscraper, is a test case for new technique for more than 1000-foot-tall building to withstand hurricane-force winds and remain stable near sea level .
• The developer broke ground on the foundation in downtown Miami in Oct. The 100 story tower will feature 205 hotel guest rooms and 360 luxury condo residences.
• It would be city’s first tallest residential building in the U.S. south of New York City when completed in 2027.

Cubicle shape supertall skyscraper in Miami

Mortgage Rates Hit 20-Year High: 모기지 이자률, 20년만에 최고치 

(WSJ     10/28/2022)

• Mortgage rates topped 7% (Averaged 7.08%) for the first time in 20 years, the latest milestone in a rapid climb that has all but paralyzed the housing market. Just seven weeks ago, the rate was below 6%. A year ago, it was just over 3%.
• In September, existing home sales fell 24% from a year earlier, and new- home sales were down 18%.  Home prices are starting to slip on a month-over-month basis, though it does little to offset the increased costs of buying.
• Some who have waded in said they prefer the calmer this year’s market compared to last year’s, when homes were selling sight-unseen and bidding wars were common.

Economy Grows Amid Risks: 위험요소가운데 경제는 성장

(WSJ  10/28/2022)

• U.S. economy grew in the third quarter but showed signs of a broad slowdown as consumer and business spending faltered under high inflation and rising interest rates.
• GDP grew at a 2.6% annual rate in the 3rd Qt after declining in the first half of the year, the Commerce Dept said 10/27.
• Trade contributed the most to 3rd Qt as the U.S. exported more oil and natural gas with Ukraine war disrupting supplies in Europe. Consumer spending grew but a slower pace than in the prior quarters. Business slashed spending on buildings and residential investment fell at a 26.4% annual rate.

Quarterly change in U.S. GDP

Private Real-Estate Funds Rise even as Listed Rivals Tumble: 상장 펀드 힘든 반면, 사모 부동산 펀드 강세

(Record    11/01/2022)

• Nontraded real-estate investment trusts has been a strong year. Some of these funds have returned about 10%, while it’s been terrible for publicly traded REITs.
• Nontraded REITs are like public REITs in that they buy commercial property such as warehouses, apartments, and office buildings. The difference is that public REITs raise money by selling shares on the stock market, while nontraded REITs raise money directly, mostly from individuals through financial advisers.
• These individuals investors can cash out only periodically through funds’ sponsors. Blakstone Inc.,(BREIT) has raised more than $62B and Starwood Capital Group(SREIT) has raised about $12.7B.

The Fed will reach to the terminal rate soon: 기준금리 인상이 곧 끝날 예상

(Korea Daily/Times  11/2/2022)

• According to Bloomberg, as FOMC will raise the rates by 0.75% this week, Korean currency exchange rate might be over 1500 Won per a dollar. (the current exchange rate is 1420 Won). The fed fund rate will become 3.75% – 4.00% this week.
• Goldman Sachs forecasts the federal fund rate will become 5.0% as a terminal rate in March next year.
• JP Morgan forecasts the rate increase of 0.75% in November, 0.5% in December, and 0.25% in early 2023.

Musk Acts Fast After Twitter Takeover: 머스크, 트윗터 회사 인수후 바로 정리 작업

(WSJ     11/2/2022)

• Elon Musk purchased Twitter company at $44B and fired two top executives (CEO and CFO) right after the take over.
• He is “Chief Twit”, CEO of Tesla and Space X (Space Exploration Technologies Corp.)
• Twitter will be forming a content moderation council with widely diverse viewpoints.